Where is PowerWall and Pack cost effective today

[dc_h]

Energy costs are highly variable regionally. Hawaii and any island is expensive, same with Australia, Japan and Denmark.
Does anyone have some math for the extent of markets that are cost effective for batteries today and cost requirements for cheaper energy markets?

Here's a list of costs by country.
Average electricity prices around the world: $/kWh | OVO Energy

 

[ByeByeJohnny]

This got a little long but I wrote it so I'll post it.

High energy prices could be for (at least) two reasons. High production costs and/or high energy taxes.

Then there's the cost for being connected to the grid which in most countries you are not allowed to skip.

A list like that is pretty useless for comparing production costs. As you can see from my example below a very small part of what most people pay actually comes from producing the electricity. Take a look at my numbers.

For October my electricity bill in Sweden had a grid fee of 63.75 SEK per month and a transfer fee per kWh of 0.6685 SEK.

I used 517 kWh (it's an apartment) so the grid cost comes to 63.75/517=0.1233+0.6685=0.7918 sek.

I then actually buy electricity from another company paying 0.3713 SEK per kWh (up from 0.29 in September, It varies over the year, average is probably 0.33 or so). But you have to add various energy and regular (VAT) fees and taxes that brings the actual price up to 0.912375 SEK per kWh.

Total cost per kwh in October was 0.7918+0.9124=1.7042 SEK. At a dollar rate of 9.30 per SEK that comes to $0.18 per kWh.

The interesting part though is that of my 1.7042 SEK cost only 0.3713 SEK is actual cost for the produced electricity. Everything else is grid cost, energy taxes and regular VAT. A whopping 22% of the cost I pay comes from actual electricity cost. That 22% actually includes a profit for the producer as well. The actual electricity is about $0.04 per kWh.

So if I started to produce my own energy (disregard that I'm in an apartment). What cost would I actually have to beat for it to be profitable? What costs would I be able to not pay? Would I still have to pay for the grid? Would I still have to pay the energy taxes? Ask in 10 countries you would get 10 different answers.

Oh, and as the article writer acknowledged exchange rates makes this even more difficult. In 2011 when he compiled those prices the exchange rate was almost 30% better. So my price today with 2011 exchange rate would have been more like $0.26 per kWh. Except for me living in the same place the actual cost would still be the same.

Since how you pay for you electricity and how it's taxed is different in every country there is no way you can take the average consumer prices and just compare them to find out where solar and batteries are a good economic idea.

As for now I would think there are very few places on earth where it makes financial sense unless you can fill your batteries for a very low price during the night and if a lot of people start doing that where it's possible today the prices in those places will soon change to make it less worthwhile.

 

[BerTX]

It's even more complex than that. There are 3300 electric companies in the USA alone, each with their own pricing and policies.

Where I live, there is a $25/ month "availability charge" , then a charge for usage and taxes on top of that. If I use zero electricity in a month, I still have to pay $25. With solar power. my net usage is zero (actually less than zero), but the solar generation and usage on a monthly basis don't match up exactly. In the winter it is cloudier here and the days are shorter, so less generation. I have electric heat (ground-source heat pump) and come close to breaking even on a monthly basis, but day-to-day and even hour-by-hour, I would need a pretty significant Powerwall setup to bridge the gap. I would be saving the $25 a month if I went off-grid, but it would take 18 years to gain back the cost of even one Powerwall.

So no, not where I live.

 

[dc_h]

Island nations generally have rates over 50 cents per KWh. Many regions also have high marginal rates and tax incentives to use batteries to increase off peak use and provide network resilience. Another 2-3 billion people have limited or no grid, so battery could be more than just about rates. Island systems may be more utility than residential or combination. Community solar may also be effective in many markets.
Where are powerpacks more effective than peaker plants, is it cheaper than all or most diesel generators? Limited grid markets where diesel generators are used, it seems TE is very cost effective. Is that a billion consumer market today, and how fast does that grow as prices decline.
There may not be clear answers yet, but this will determine how big TE can be today and growth rate.

 

[ByeByeJohnny]

Island is an island nation. They probably have some of the lowest production costs in the world for energy.

But yeah, in general you are right. For now the market which makes financial sense is in places with no grid or a very small grid that runs on generators. Apart from some rich tourist popular islands it's a lot of places with poor infrastructure in general. Like poor, rural parts of Africa, Asia and I guess parts of South America.

Just as many of these places have skipped over landlines for phones going directly to mobile they have the potential of skippping the grid and going for smaller systems with batteries.

The main problem of course being that a seemingly expensive $10.000+ installation in the west will be astronomically expensive for most of the places that could best use them. Most places are not gonna be able to get a subsidized system from Tesla.

 

[SebastianR]

The main problem of course being that a seemingly expensive $10.000+ installation in the west will be astronomically expensive for most of the places that could best use them. Most places are not gonna be able to get a subsidized system from Tesla.

Well, there is currently a chance of resolving that: a lot of investment funds (think big pension funds of e.g. teachers or companies that have a strong CSR component) are required to do socially responsible investments and with the right financing partner these kinds of projects are perfect for social impact investments. I was recently in Addis and saw a ton of Vestas people in the hotel working on powerpoints for all kinds of wind parks. So while I think that financing is indeed one of the key issues for renewables in the developing world, I'm equally convinced that there are solutions to that.

 

[ecarfan]

Island is an island nation

i assume that you intended to write "Iceland is an island nation" but your Autocorrect overruled you.

 

[Ampster]

i assume that you intended to write "Iceland.........

Haha, originally I thought he meant Ireland but couldn't reconcile his statement about cheap energy. Now it all make sense because of the abundant geothermal in Iceland.